This log plot shows various items as % of GDP. Cumulative deficit is near 100%. Gross federal debt is approximately equal to private sector debt (bonds), Gross national debt (blue) is the sum of the two is near cumulative deficit. National defense varies from 50% at the peak (year 1945) to about 4% in year 2005. Surpluses are shown in the log plot and the blanks are deficit years (from 1970 to 1996). GDP falls after surplus years including after year 1997. Gross federal debt is the sum of private sector debt and government debt (from itself). If bond sales are eliminated (or discontinued) the government can borrow as much as it needs from itself and save unnecessary interest to the private sector. And the national debt would vanish (in a few years)! After 1971 there is no gold standard and fiat currency is operational and there is no need for bond-financing (except for the unnecessary requirements based on the gold standard). GDP is a constant 100% in the above plot.

Note.—See Note, Table B-78.

Sources: Department of the Treasury and Office of Management and Budget.